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9 Opinions for 2021

| January 07, 2021

Some poetic license by the writer, sometimes rephrased in my own words . . .

1. Dividends historically have been more stable than stock prices

Author's note: Not making any recommendation regarding dividend or non-dividend-paying items.  See link below.  "In the early 1980s, Nobel laureate Robert Shiller pointed out this phenomenon, noting that—since a stock’s value fundamentally reflects the present value of its future dividends—the wild stock price swings made little sense. Keep that in mind the next time the market throws a tantrum."  --  Source: Linked below Robert Shiller and Humble Dollar

2. Wall Street bullish "forecasts are worthless."

"Acting on stock market predictions from Wall Street strategists or anyone else is a surefire way to lose money."  -- --  Source: Linked below Humble Dollar .. Author's note again. I agree so I included the quote.

3. "Short-term interest rates will remain very low in 2021"

The Federal Reserve has told us on more than one occasion that, in effect, “We aren’t thinking about raising rates. In fact, we aren’t even thinking about thinking about raising rates” --  --  Source: Linked below Humble Dollar

4."Money will flow into the best-performing asset classes"

Source: Linked below Humble Dollar

Despite "expert" and / or "professional" (or individual Financial Advisors) views on diversification for risk management. Another author's note: If you have an allocation or diversification goal or ideal percentages and one portion of your portfolio went way up, then that portion is overweighted in comparison to your goal. So doing the arithmetic, if your goal is still good, then you need to sell some of what went up and buy some of what went down. The above quote is a recognition that many people have emotional difficulty rebalancing as just described.

5. "Your portfolio is like a bar of soap, The more you touch it, the smaller it gets."

I'm quoting myself / old cliche. Humble dollar guy said the more you look at it the worse your results. Same idea.

6. Life will not return to normal

Humble Dollar guy John T Lim self-identifies as a physician. His opinion above. I share it. Also see link below. Second order possibilities. Do some major companies end up with excess office space? Seems like it. What happens in "downtowns" of "not small" cities with many restaurants and other lunch options serving the working people who were in these offices and now WFH? Tough business and some of them might not do so well, to understate the size of the issue In My Opinion.

7. Consider a partial Roth conversion

I often say that my crystal ball is cloudy. Also encourage all to consult their own tax advisor. But in your specific situation, if you feel your taxes are more likely to go up short-term than down, and, of course complying with all IRS requirements, run the numbers or have someone do it for you.

8. Maxing any match available - full or partial - sounds VERY good to me!

I feel most of us Financial Advisors are big fans of the match. In any form. You're saving money. Someone / some entity is giving you some more money to deposit wherever you are saving it. Why not!?

9. If you are healthy, is a high-deductible health plan right for you?

I am of two minds. When I had minor children in the home my status was employee and the health coverage for the family at the time was excellent so I did not personally have to navigate what is now a much more challenging environment. If you ae in a family structure with 3 or more people on one plan and all of you are very healthy, I might agree with the high-deductible idea. In general, I'm not a big fan although surprise medical bills maybe are less of an issue going forward.

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